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States Would Decide Service Under Bush's Amtrak Plan

The Bush administration proposed a national rail plan today to restructure Amtrak and leave important decisions about train service, including long-distance routes, to the states.

''We do not propose to eliminate Amtrak, but we do propose comprehensive structural changes,'' Michael Jackson, the deputy transportation secretary, said at a Senate Commerce Committee hearing.

The current five-year Amtrak authorization as a federal corporation to provide the national passenger rail service expires in September, and Congress is weighing proposals to overhaul the railroad and chart a new course for a national rail system.

David Gunn, Amtrak's president, said the administration was looking at passenger rail reform from ''30,000 feet'' instead from the ground. That is where he says a long-term plan is needed to fix the system's antiquated and crumbling infrastructure before serious change can be considered.

Mr. Gunn has proposed a five-year, $8 billion business plan for Amtrak that would maintain its existing route structure, make comprehensive capital improvements in the Northeast, and fix wrecked and damaged equipment.

The administration envisions a six-year transition from the current city-to-city rail service now provided by Amtrak to a system that would incorporate federal and state governments and private companies.

''Amtrak's core business design suffers from structural rot,'' Mr. Jackson said. ''For decades, the federal government has embraced perverse incentives that consistently impel Amtrak to make irrational business decisions.''

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Under the administration's plan, the Transportation Department would continue to define rail safety standards and enforce them. The agency would provide capital grants directly to states and state consortiums.

''State agencies would determine the level of passenger services needed, the price for such service, and they would contract with third-party operators to provide long distance and corridor trains,'' Mr. Jackson said.

Corridor trains are short-haul routes of about 500 miles between large cities.

For a period of years, the federal government would continue to finance the majority of capital expenses for certain projects. But states would eventually provide at least 50 percent of needed capital investments.

A major component of the administration's long-term rail proposal would create a federal-state entity -- the Northeast Corridor Compact -- to oversee the Northeast Corridor between Washington and Boston. This would be financed by federal grants and have authority to finance capital improvements.

Amtrak would be recreated as a for-profit corporation and would contract with the compact to run trains on the corridor. A separate company would be formed for maintenance and capital projects in the Northeast.

Mr. Gunn cautioned the administration about separating responsibilities for capital and operating needs, saying a similar approach in Britain has failed. Kenneth Mead, the Transportation Department inspector general, also sounded a warning about this approach.

Amtrak Operations, as it would be named, could operate corridor trains outside the Northeast as well as any long-distance service under state contracts. Separate state and regional operating companies would be set up to make those decisions.